Cider Focus: Cider still rosy
While the cider category has again outperformed every other drinks category this year - thanks to yet more innovation and investment from cider makers - duty and new regulation have also been in the news.
We started the year in discussion with Treasury and Her Majesty's Revenue & Customs discussing definitions of cider and the duty rate associated with it. At the Budget in March we received an above-industry duty increase that was subsequently overturned by the coalition government.
The government's clear determination to consider in detail the duty and definition of cider is to be applauded in the context of the great volume of 'background noise' on alcohol in general and cider in particular, and we welcome the definition of cider that has resulted from that work.
It is vital that if we are to balance the development of sensible legislation and the need to address alcohol misuse then retailers, producers and all other agencies must not muddle the issues. There have been too many instances in the past year of people within and outside of the drinks industry offering a poorly informed view of cider and of alcohol more widely.
For our part, we welcome the opportunity to share the reality of our industry and our view on the impact we have with any interested organisation or business.
There has been a great collaborative effort to produce the definition. This not only ensures that large-scale producers can continue to invest in orcharding - an investment measured in decades - safe in the knowledge they will not be unfairly penalised; but vitally, it also protects the smaller craft end of the market as well.
Looking forward, we will work with government to understand the impact of the new regulation and like all producers and retailers we will see how the increase in VAT affects consumer spending.
However, I think it is the nature of cider makers to be positive, and the category is in good shape. I am confident that the people working in the cider industry will ensure that we can face the challenges we will have.
A year in cider
March - Alistair Darling puts up cider duty by 10 per cent above inflation in Labour's final Budget before the election. 70,000 people join a Facebook campaign in protest.
April - Labour is forced to backtrack on the proposed hike after pressure from the Conservatives. The duty increase was to stay in place and expire on June 30, when it would be subject to the same two per cent above inflation duty rise as other alcohol. Labour pledges to reinstate the tax if it wins the election.
May - David Cameron becomes Prime Minister at the head of a coalition between the Conservatives and the Liberal Democrats.
June - Cider makers cautiously welcome the new Chancellor George Osborne's decision to reduce duty on the drink in an Emergency Budget.
August - Drinks giant Diageo urges the government to raise duty levels on beer, wine and cider to bring them in line with the spirits duty level of 23.8p per unit.
October - Mark Hunter, chief executive of brewers Molson Coors, calls for cider duty to be upped following a report highlighting cheap supermarket deals.
November - Cider makers welcome new rules which mean cider or perry with less than 35 per cent fruit juice content will face a higher rate of tax. Most high-profile mainstream cider brands will not be affected.
